The recently concluded visit of Mr. Modi to China raised many expectations and was not missed by any media. Wall Street Journal tries to summarize Indo-China relationship as 5 gaps based on the economic difference and border disputes that mar the relationship of these Asian Giants. In this context, it is interesting to analyze if closing these gaps is in the interest of China and if any of Indian "concessions" are of significance in closing this gaps to ensure peace and prosperity.

Concluded visit and un-reciprocated Concessions

Mr. Modi was as usual more than life itself and the much hyped visit to China was more favorable to China than India. While Mr. Modi was direct in broaching up the subject of border dispute and the growing trade imbalance, nothing concrete was obtained from China. Instead, Mr. Modi ended up announcing e-visas to Chinese, which is not reciprocated as in the case of any previous concessions. Further, until now, China is issuing stapled visas to Indian citizens from Arunachal Pradesh and Jammu & Kashmir. The e-visa is also a problem from a security perspective, given the Chinese penchant for spying. In addition to this it is understood that Chinese companies struck deals worth $22 billions, which would only widen the trade-deficit with China.

However, the most important concession China got was before Mr. Modi reached China, which unfortunately didn't receive much media attention it should have. During the UPA regime, after the many cries of strategic analysts, the then Prime Minister of India approved the setting up of Indian Mountain Strike Force (IMSF). This IMSF was particularly raised to counter the Chinese Rapid Action Force (RAFs) stationed at the other side of the border. There is no announcement on China reducing its RAF or moving it away from its stations near the border. Shortly, before Mr. Modi's visit Mr. Parrikar announced the reduction the size of IMSF, ostensibly under the guise of finance crunch.

In contrast to many expectations for Mr. Modi before he came to power and irrespective of his overwhelming majority, NDA Govt. is yet to re-initiate India's covert capabilities.

Source: UN COMTRADE

India feeds China's Might

Mr. Modi may have been direct seeking clarification on Line of Actual Control (LAC) and Mr. Ajit Doval would may have been direct in saying that all bilateral relations are centered around the border issue, but India has been seeking the clarification for over 10 years now. And, China is definitely not inclined to provide that lest it would cool of the border issue. Many Indian analysts are of the view that China is particularly uncomfortable with the clause in 2005 agreement that explicitly states that no populated regions would be exchanged. Further, they are of the opinion that China is keeping up the ante over the border issue to pressure India to isolate Dalai Lama.

However, I tend to disagree. For one reason, Chinese are pragmatists. They have no problem over Human Right excesses whether in their own land or in a foreign country. If all they wanted was to eliminate Dalai Lama, they could have resorted to a number of ways to that without upping the ante over the border issue. Their "all-weather friend" has sufficient influence and penetration and influence to see to that. China itself has sufficient level of penetration in India. Hence, I couldn't believe that Dalai Lama is the primary issue over which China is least inclined to solve the border dispute.

In my perspective, the border issue is more to do with the China's global ambition to equal US in power terms. Dalai Lama and Tibet is a just an add-on.

In my perspective, the major reason for China to keep up the border issue is its to equal US in economic and power terms. For that China, which is largely dependent on its exports require markets. India, with its huge population and potential is a great market for its products, irrespective of the fact those products are defective or of the least quality. The bilateral relationships were ignited after 1987 and it is the hope of India that an increased economic relationship with China is likely to make China more sympathetic to its cause, irrespective of many actions to the contrary by the latter. As long as the border issue is hot and as long as the 1962 ghost looms at large in the Indian mindset, China expects India to bend backwards to suits its interest. India, aptly does so. With India being the largest trading partner of China, it is not in the interest of China to settle the dispute now or in near future. If the border dispute is settled, there would be no incentive to India to keep up the yawning trade deficit and would be free to chose partners more amenable to its interest, which China cannot afford. Hence, China wants the border issue to burn hot as much as possible. The only time, when it may settle is when China equals US in power parity and have "settled" its disputes over South China Sea. India unwittingly aids in the rise of China's might through economic largess (trade deals that greatly benefit China). Such trade surplus on the Chinese part have enabled it to modernize its defence forces with a double digit raise in defence expenditure. This only draws India into a vicious cycle of appeasement and fear, yet no action is seen from the side of India.

Challenge of India

It is difficult not to draw parallels between India 1962 and India in 2015. While it is true that India has developed military and economic capabilities, it is also true that China is ahead of India in all these sphere by at least a decade. Like then, infrastructure development is largely neglected at the best tardy. Like then, China is building infrastructure that could be used strategically but India stand as a mute spectator. India is even running short of ammunitions. Like then, if not more, nepotism, racism, casteism, and corruption is rampant in India. It is believed that the 1962 debacle was at least partially because of nepotism. In addition to all these, like then, India still believes in appeasement politics vis-a-vis China.

Currently, India is not China's target at least for now. Any war with India would mean a setback to China by at least decade, irrespective of the fact that India may lose. In a way, India's border dispute is a red-herring to keep people attention on one thing when the real fight is somewhere else. The West hardly misses it but try to use the situation to its advantage by proposing to sell its antiquated equipments to India. India is forced to consider those deals mainly because of its lack of capacity to produce those equipments indigenously.

Hence, the continued appeasement by India to win China's sympathy could hardly be expected to work. If the border dispute is to be settled India has to deal with China at the same level. However, it is highly unlikely that the China would be least interested to settle the dispute before it becomes equal to US and have settled its territorial disputes in the South China Sea. In this context, it could said that India is building China's might against US, through its huge trade deficits vis-a-vis China (in the same vein, other trading partners who maintain a large trade deficit vis-a-vis China).

Though Mr. Modi is a fan of China, he had hardly understood China. China came to this position most through its covert activities (Ex. US arrests of Chinese for economic espionage) and by reversing brain drain. On the other hand, India neither has covert abilities nor is keen on reversing brain drain. This is irrespective of the fact that many in the Indian diaspora is increasingly showing interest to come back for economic opportunities and resume family ties. The current economic crises and subsequent policies, many Indian students and researches were stranded abroad who would gladly return given an opportunity. Hence, if Mr. Modi sincerely longs to settle the border dispute, the real challenge is not the appeasement of China but building capacities to deal with China on equal footing by taming nepotism, racism and corruption.